Articles » Options Market
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Because the actual calculation, and sometimes even the discussions, of volatility involve some fearsome mathematics, novice options traders often forgo learning about it. Those traders are at a disadvantage compared to their more intrepid competitors. And unnecessarily so, since the concept is not only useful but simple to understand.
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Why do options offer any advantage over trading stocks? They're riskier, since they expire within a certain amount of time and their values are more complicated to assess.
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Hedging, Trim Risks Not Bushes
Options are frequently used in hedging. A hedge is an investment made to offset the risk incurred by entering another investment. Ironically, the basic idea is to bet against oneself, in a way.
